ABSTRACT
In 1991, India made a firm break with the past. Faced with bankruptcy, the government made a commitment to economic reforms in order to meet the conditions of a 'structural adjustment programme' devised by the International Monetary Fund (IMF). The pact envisioned a withdrawal of the licence-permit regime under which the government controlled private-sector business and progressive privatization of the public sector. The government also made a commitment to liberalize imports and facilitate exports. Further, the 'structural adjustment programme' called for a reduction and eventual elimination of subsidies to the agriculture sector, the public sector and to various influential lobbies. Despite the fad that the government did not have majority backing in Parliament, where the ruling Congress party controlled just 220 of the 540-plus seats, the reforms proposal did not face much opposition.
